Information Ethics & Legislation
Towards More Understanding in Licensing Between Licensors and Licensees
Tuula Haavisto, EBLIDA; Finland
Electronic publishing and business is changing the relation of libraries to producers, subscription agencies and other
object of business is no more a physical object like a book or a journal, but access to information. The ownership remains
producer. In this situation, provisions of access, including the price, must be negotiated.
In less than ten years, the spirit of negotiations has changed a lot. At the beginning, producers were nearly dictating the
offered standard contract texts, where the licensee point of view was hardly recognised.
The change happened, when libraries joined together to form consortia. In a negotiation, 50 libraries can press a vendor
only one! Nowadays, the contract texts are often really a result of a negotiation of two parties.
Even further development can be seen: e.g. in December 2000, a Memorandum of Understanding was adopted by a project called
TECUP. In this memorandum, representatives of libraries and vendors seek for balanced consensus in electronic document
Electronic journals and other web products represent a growing market. Citizens require more and easier
access to electronic documents. Libraries play a key role here, involving major changes in library purchasing habits. In the
electronic environment, librarians continue to purchase physical objects e.g. books but now also access to electronic
material. For this, licensing contracts are needed to agree about the provisions of use. Licenses must be negotiated with
publishers, who until now are mainly international. Provisions of use in the electronic environment are a new topic for all
In addition to this, the electronic environment implicates further changes in the work of all the partners.
E.g. the responsibilities in the publication chain are mixing with each others. Earlier it was self clear that libraries are
in charge of producing bibliographic information. Nowadays, publishers themselves add often the metadata to their original
documents. As a consequence, the role of libraries is now defined to be more to co-ordinate the bibliographic data produced
in several institutions. They are also pooling demand of the users, offering them access to up-to-date material and pooling
financial resources from the financing bodies. From the publishers point of view libraries have also a role in long-time
preservation of material which the publishers no longer hold in stock.
All these changes should be administrated at the same time, which is a challenge to all involved.
The first contacts
Though both partners were inexperienced in electronic matters, the first contacts in mid-90s were
unbalanced. The publishers have for ages made contracts with the authors. They have full-time lawyers who know the copyright
and contract legislation. In some countries libraries do have some permanent legal advisors, but they are few the level of
knowledge on this area was low in libraries.
Fortunately, there was some earlier experience in libraries: licensed remote use of the traditional
bibliographic databases had been available for a long time. Now databases were offered also via Internet. The CD-rom
licenses were also known in libraries, though they concern off-line material.
Concerning journals and other full-text material, especially on the research publishing field both publishers
and libraries saw the advantages of electronic publishing: savings in printing and mailing costs and one solution to the
journal price crisis. Later on, libraries begun to see possibilities to choose only the very material really needed in the
The first efforts were made on parallel subscriptions: libraries did get the print copy, and access to the
electronic journals. The price was based on the print version price added with an agreed percentage.
The first contracts were publisher-driven. They made the drafts, and in most cases libraries just signed
without bothering themselves too much with the content of the contracts.
Libraries learn the lesson and join together: consortia forming
It did not take too long when libraries noticed that it was a mistake they had to get deeper into the
contract matters. They must e.g. be aware which is stronger in their country, the contract law or the copyright law. The
best case from the library point of view is when the provisions granted to the user in the copyright law cannot be
overridden in a contract. Further, the consumer law or the competition law can include provisions against abuse of dominant
position or anti-competitive agreements. These laws have not been very known among librarians. Libraries have not actively
used them when defining their position in the licensing negotiations.
Librarians also noticed, that it is waste of resources to sign separate contracts in each library, and for
each vendor. They begun to form consortia.
The development in Turkey, though happening later than in English-speaking countries, is a good example: In
1998 the first subscriptions to online databases on the basis of institutional subscriptions were made. The prices were
high, and the contracts caused a lot of work to each institution. The consortia activities begun in April 1999, and in
December 1999, the first agreement was made between ISI and 17 partner libraries (Web of Science Consortium, or WOSCON).
A consortium means a temporary co-operation of several powers or large interests to effect some common
purpose. Libraries join together to share the burden of the work and/or the licensing costs.
There are several ways to end up to a licensing consortium. In the preliminary CELIP survey about the
licensing situation in Central and Eastern Europe three main histories were identified. The first one is to add licensing
matters to the tasks of an existing consortium often there are consortia for e.g. union cataloguing. This was the
Slovenian model (COBISS), and this is planned in Estonia (ELNET). The second model is used in the Czech Republic and in
Hungary: small consortia, each one around one vendor, are formed by libraries interested in this one concerned material. The
third model can be found in Bulgaria: a publisher, Martinus Nijhoff Bulgaria, makes an initiative to several interested
libraries, who then form a consortium.
A fact is that licensing consortia are the only rational way to administrate purchasing of fee-based
electronic material. In their framework it is often possible to hire full-time staff librarians and lawyers - to take care
of the contracts. This kind of specialisation is badly needed in libraries.
The library consortia do co-operate. They have founded the International Coalition of Library Consortia,
ICOLC, which is actively organising conferences and publishing material on its website (see the sources).
The role of subscription agencies
In addition to publishers and libraries, subscription agencies can be active partners in the licensing
arrangements. They can take care of the copyright negotiations, they can build up larger selection from the materials of
several publishers etc. They often offer also consortium management services to library consortia. E.g. the well-known NESLI
project in the United Kingdom is administered together by University of Manchester and Swets Blackwell.
A special case is the eIFL Direct programme of the Open Society Foundation (OSI). The Foundation has
negotiated a framework licensing agreement and price level with the subscription agent EBSCO on behalf of all the 39
countries where OSI is active. The agreement covers access to all in all over 3.200 journals, primarily in the social
sciences and humanities. Newspapers, pamphlets, and a small range of full-text reference books are also included. Recently,
more mathematical-technical journals have been included. The concrete arrangements must be done and the fee to EBSCO must be
paid in each country separately. In most countries libraries have founded consortia to manage their eIFL resources. A
special character in the eIFL Direct programme is that it is open for public libraries as well. Thanks to this, public
libraries in the concerned countries are at the moment more experienced in licensed web material than their counterparts in
most other countries.
The pricing policies in licensing matters seem to be in a turbulent situation. Different publishers prove and
offer different models this was one of the lessons of the Euro ICOLC conference in Berlin on December, 2000. Dr. Pit
Froben from the German Friedrich-Althoff-Konsortium, presented in Berlin the basic models and possible future trends in the
Price based on collections
- most simple, most used today
- a) print base + e-fee (usually a certain percentage of the print price)
- b) e-base + DDP (deep discount price)
Flat e-rate, based on the price of the product
- independent of the price of the print subscription
A mixed model
- 1. A core list of journals with print and online, priced after model A or B above,
- 2. A list of journals for online only, and
- 3. A prepaid package for on-line full-text articles from journals outside the core list 1
According to Dr. Froben, models A and B are publisher-driven, model C can be library-driven. Today, consortia
try to unbundle the print and e-versions in pricing.
Dr Froben gave also an example of the case C3. One of the agreements of the Friedrich-Althoff-Konsortium
allows to print out 50.000 articles outside the named journals (the core list of journals) included into the contract. The
total yearly price of the concerned contract is over 3 million DEM. In 2000, only ca. 25.000 articles of this quota were
used - this is a typical situation. If there would be more than 50.000 "outsider" articles printed, they would cost 18 USD
New steps in the contract negotiations
The status of libraries has grown better in recent years. First of all, joining in consortia they have more
power in the negotiations. They are also more experienced, and they have learned from each others. They dare to demand
better provisions of use, and this has led to positive results.
This can be red in several position papers given out by libraries at the end of the 90s (see the sources).
These papers are highly political, trying to re-locate libraries to the publication chain.
The ICOLC conferences are nowadays important venues for open discussions between libraries/library consortia.
They serve also as a forum for discussions with the publishers and subscription agencies. In the Euro ICOLC conference in
Berlin, several publishers told about their plans concerning e.g. pricing policy. Consortia representatives had a
possibility to ask more and comment the plans.
But in countries with less experience, the publishers and other vendors have still the possibility to use for
their own advantage the weaker position of libraries. Therefore it is crucial for library communities in all countries, to
be in contact with their colleagues to get the advantages of their experiences. This is the goal of e.g. the CELIP project,
for which I work.
An example of the disadvantages of countries with less experience is, that they dont use trials to find the
best offers from the electronic market. In the CELIP licensing situation survey it turned out, that of all the ten CELIP
countries, trials were used only in Hungary.
There are also projects, especially in the European Union framework, which seek more concrete understanding
between the partners. One important project, which produced several interesting documents about e.g. the legal framework and
business models, was TECUP, Testbed Implementation of the European Copyright User Platform (1998-2000). A very useful
outcome from TECUP is the Memorandum of Understanding. This document was given out as a result of many discussions between
tens of libraries, publishers, subscription agencies and collecting societies.
The Memorandum of Understanding identified both the issues where a consensus has been and has not been found
at the moment. The following lists are based mainly on the Memorandum of Understanding.
A consensus has been reached between licensors and licensees in these matters:
- there is a role for authors, publishers and libraries, as well as a supporting role for booksellers, subscription
agencies and collecting societies in the publication chain, though their roles will change and mix with each others in
- more common standards are needed in the publication chain, all the partners must do their share to help to identify and
access to a single work
- access to high-use material - normally via the subscription model
- individual password access should be avoided where possible
- to make different levels of usage possible, granularity should be at the minimum purchasable unit
- license agreements should contain sufficient indemnities and warranties against copyright infringements
More work is needed to reach consensus in these areas:
- access to low-use material - MoU recommendation: pay-per-use model
- to develop sufficiently standardised technical solutions and authorisation systems (rights management system)
- cross-searching and cross-linking
- development of new business models
- permanent access and long-term archiving
- position of walk-in users
- interlibrary loans (fax and paper copies are often allowed)
- which is the country of governing law and courts concerning the contract
- taxation of electronic information
In less than ten years we have come so far, after beginning from nearly scratch. To get further, more
co-operation is needed.
- including e.g. Memorandum of Understanding
- including e.g. the CELIP survey on licensing situation in Central and Eastern Europe, and a link to the Case Turkey
presentation by Jane Ann Lindley, director of the Koc University Library / Istanbul
- including e.g. the CECUP Position on User Rights in Electronic Documents
- including e.g. links to licensing policy papers by libraries and library consortia and Licensing Digital Resources: How to
avoid the legal pitfalls? by Emanuella Giavarra
- including information about the Friedrich-Althoff-Konsortium
The Slovenian consortium COBISS: http://www.izum.si/cobiss/welcome_eng.html
The Estonian consortium ELNET: http://www.utlib.ee/elnet/index_i.html
The UK consortium project NESLI: http://www.nesli.ac.uk/